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13. Free Cash Flow Model) A firm has forecasted free cash flows as follows: Free Cash Flows (Smillions) 100 250 1 250 4 300 5
13. Free Cash Flow Model) A firm has forecasted free cash flows as follows: Free Cash Flows (Smillions) 100 250 1 250 4 300 5 350 Beyond year 5, FCFs are expected remain flat indefinitely. The firm has $500 mil in short term investments; $100 million in preferred stock, and $300 million in corporate bonds. There are 20 million shares of common stock outstanding. If the firm has a weighted average cost of capital of 13%, what is the intrinsic value of the common stock
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